EUR/JPY Price Analysis: Consolidates in a pennant pattern

• EUR/JPY is trapped in a pennant pattern, as seen on the 4-hour chart. 
• A breakout would expose overhead resistance at 124.90.

EUR/JPY has carved out a contracting triangle or pennant pattern on the 4-hour chart. 

A breakout, if confirmed, would signal a resumption of the rally from the July 10 low of 120.27 and open the doors for 124.64 (200-week simple moving average), above which a major resistance at 124.90 (August 2018 low). 

Alternatively, a pennant breakdown would imply bearish reversal and shift risk in favor of a drop to the ascending 50-day SMA, currently at 121.31. 

The pair is currently trading largely unchanged on the day at 123.70. The pennant resistance is located at 123.78 while support is seen at 123.11. 

4-hour chart

Trend: Neutral

Technical levels